Editor’s Note: This is the twentieth installment of “Southern (Dis)Comfort,” a series from War on the Rocks and the Stimson Center. The series seeks to unpack the dynamics of intensifying competition — military, economic, diplomatic — in Southern Asia, principally between China, India, Pakistan, and the United States. Catch up on the rest of the series.

Despite occasional strife, India and China have operated in separate strategic theaters and avoided major conflict for more than half a century, since they fought a war over territorial disputes in 1962. But today, that may be changing as China makes economic and maritime inroads into Southern Asia.

India is responding to China’s forays into the Indian Ocean by fortifying its relationships with strategic partners. India, which was the only major country to turn down an invitation to a forum on the Belt and Road Initiative, seems eager to establish an alternative to Chinese-led economic integration. India, Japan, and the United States have indicated a collective intention to support strategic port development in the Indo-Pacific. On the naval front, India has inked logistics pacts with Singapore, the United States, and France. Delhi is also working with Canberra, Tokyo, and Washington to resuscitate the “Quad,” a grouping of democratic naval powers that are concerned with China’s power projection in the Indo-Pacific and the threat it poses to the “rules-based” order.

The growing overlap between India’s strategic backyard and China’s strategic periphery foreshadows a danger of increased interaction, competition, and friction in Southern Asia. How will this overlap play out in the coming decade? Will it inevitably trigger major conflict through increasing competition and potentially destructive escalation, or will a manageable “new normal” emerge with some small-scale conflicts, but widespread stability on balance?

An examination of the two countries’ threat perceptions, permanent and evolving interests, and strategic calculations suggests major conflict is not inevitable. India and China are two rising powers that have deep-seated, albeit categorically different, fears of encirclement in their respective backyards. While India’s fears are real and greater than China’s, expanding Chinese national interests do not necessarily require circumscribing India’s sphere of influence. A close reading of Chinese official documents suggests that China’s incursions into the Indian Ocean are not intended to acquire territory. In fact, they provide an opportunity: Interactions between the two countries in the region can be managed through mutual learning to dampen the prospects of miscalculation and escalation.

Same Fears of Encirclement, Different Levels of Concern

India’s sense of encirclement by China is a recent phenomenon. For a long time, Southern Asia occupied a marginal position in China’s peripheral diplomacy, leaving India largely free to assert its regional dominance, especially vis-à-vis smaller states. China’s efforts to build ports in Pakistan, Bangladesh, and Sri Lanka — as well as the Belt and Road Initiative — are part of its strategy to surmount the “Malacca dilemma” through infrastructure development and economic connectivity. China does not seek to prevent India from exerting influence with neighboring states, but the way it has pursued its goals may have exacerbated Indian fears. India’s primary objection to Belt and Road is that the initiative violates its sovereignty (the Karakorum Highway, slated for expansion under the China-Pakistan Economic Corridor, traverses Gilgit-Baltistan, a disputed territory between India and Pakistan). Delhi also appears to be deeply concerned that Beijing’s loan practices could create an “unsustainable debt burden” for neutral countries in India’s neighborhood, potentially threatening Indian interests by making these governments more amenable to Chinese suasion and coercion.

Even if fears of encirclement are unfounded, it is possible to understand why Delhi seems alarmed. Indian analysts claim China has blocked India from joining the Nuclear Suppliers Group and the United Nations from designating Masood Azhar, a Pakistani militant linked to a 2001 attack on the Indian Parliament, as a terrorist. The China-India standoff at Doklam in summer 2017 also seemed to endanger the “modus vivendi” the two countries had established on border issues dating back to the 1980s, with some analysts claiming China was using a coercive playbook against Delhi.

Adding to these sources of friction and uncertainty is the ever-present Indian fear that it might one day be forced to fight a two-front war against China and Pakistan. Delhi has long bemoaned Beijing’s provision of assistance to the Pakistani military and the country’s nuclear-weapons program. Some in India view Chinese assistance as a means of “tying down” India on the subcontinent by forcing it to devote diplomatic and military resources to deterring Pakistan. In this context, Chinese investments in Pakistan via the China-Pakistan Economic Corridor make India anxious about the possibility of an emboldened Pakistan and raise questions about China’s intentions.

At the same time, there are reasons for optimism. India has received cooperation from China on the September 2017 BRICS statement listing Lashkar-e-Taiba, Jaish-e-Mohammed, and the Haqqani network as terrorist groups. Recently, India also got China’s tacit support at the Financial Action Task Force plenary, which placed Pakistan on the grey list. And without yielding on its position, Beijing has repeatedly emphasized that Doklam requires a diplomatic resolution, not a military one.

Historically, China has not regarded India as a security threat. When the two countries went to war over various border disputes in 1962, India suffered what its diplomats have characterized as a “humiliating defeat.” China assumed India’s multi-decade drive to acquire nuclear weapons was a result of its desire to elevate its status on the world stage, and, thus, did not interpret this development as a threat warranting a revised posture. China also has tended to take a dismissive attitude towards Indian military capabilities in general, and towards modernization efforts more specifically.

The 2008 Indo-U.S. civil nuclear agreement began to chip away at these longstanding assumptions. The accord signaled to Beijing that Washington was more committed to Delhi’s rise as a major power in Asia than to the global nuclear order. China now worries that the region’s shifting geopolitics, particularly the Indo-U.S. strategic convergence, could allow India to overcome its technological limitations and attain capabilities on par with China’s.

For its part, China also feels encirclement by the United States. These concerns have been fueled by the strong functional U.S. alliance system in the Asia-Pacific, an upgraded U.S.-India strategic partnership, intense U.S. pressure in the South China Sea, and a lingering perception that the Trump administration may challenge Beijing’s “One China” policy. In China, the American-fostered concept of a “string of pearls” — which appeared in the mid-2000s and held that China’s infrastructure development across Asia was a Trojan horse for an expanded naval presence in the Indian Ocean — seemed to confirm U.S. intentions to manage, if not necessarily contain, China’s rise. At the Asia-Pacific Economic Cooperation Summit in November 2017, President Donald Trump spoke of a “free and open Indo-Pacific” in which all countries “play by the rules.” This rhetoric reminds China that the United States remains the preeminent global power and that China’s rise could be jeopardized if the two powers are unable to escape a “Thucydides’ trap.”

However, China does not fear U.S. encirclement as severely as India fears it from China. Some Chinese analysts have suggested in private discussions that pressure from the United States is a cost China needs to pay to achieve its goals as a rising power. Others have even rationalized being treated as a strategic competitor as validation, if not legitimation, of China’s international status. Most importantly, after decades of interactions with the United States, China has learned to withstand U.S. pressure and pursue its objectives with self-assured, strategic patience. These patterns have neutralized Chinese anxiety about U.S. encirclement.

China and India share the feeling of being encircled, but from different sources and with differing levels of concern. India regards China’s encirclement with real concern, while China views America’s encirclement as a necessary cost and treats it with strategic patience. This distinction will need to be acknowledged as India-China interactions in the Indian Ocean.

Incentives Beyond Geopolitics and Geo-Economics

India’s concerns are genuine, but China’s effort to increase its presence in Southern Asia is not, in fact, meant to encircle India. China’s push to expand and protect its interests is not a zero-sum game: The expansion is not tantamount to circumscribing India’s role. Recent Chinese Party Congresses projected this expansion as part of China’s modernization drive, not an effort to displace India.

One popular explanation for China’s increasing presence in Southern Asia is geo-economic. This explanation posits that China is trying to use its economic strength to achieve geopolitical objectives, including strengthening Pakistan, stabilizing Afghanistan in ways that favor China, earning influence with other small regional powers, enhancing China’s physical presence in the Indian Ocean, weakening India’s dominance, and shaping Southern Asia’s emerging regional order.

The geo-economic explanation leaves some key questions unanswered: Does China really want to lead Southern Asia? What are the incentives for China to pursue geopolitical objectives in the region? How does China itself explain its own intentions?

Chinese Communist Party documents suggest India’s fears of China’s influence in the region may be overblown or misdirected. In reports to the 16th-18th Chinese Communist Party Congress, China emphasizes that its goals are economic in nature, outlining an aim of “realiz[ing] a moderately prosperous society by 2021 and formulat[ing] a strong, democratic, civilized, harmonious, and modern socialist country by 2049.” According to these internal proceedings, China is supposed to achieve economic and military modernization no later than 2035.

The 19th Party Congress report reiterates that “no matter what stage of development China reaches, China will never seek hegemony or engage in expansion.” Hegemony, in the Chinese-language context, has the negative connotation of “bullying” others. This implies that the legitimacy of power is derived from the way it is exercised, not the source from which it emanates. Understood in this way, China’s insistence that it will not pursue hegemony suggests that it may seek power, but will not abuse it with regard to other countries. It sees power not as a tool for changing the status quo, but as a way to maintain deterrence and shape diplomatic interactions in favor of protecting its interests.

As such, official texts suggest China has no intention to replace India as the dominant power of Southern Asia, though it reserves the right to disagree with how India practices its leadership, especially in overlapping physical areas that are important for China’s national interest. That’s why the 19th Party Congress report also said:

China stands firm in safeguarding China’s sovereignty … and will improve the systems and institutions and enhance capacity-building for national security, and resolutely safeguard China’s sovereignty, security, and development interests.

Instead, China explains its increasing presence in Southern Asia as an attempt to build an economic community with a common destiny, or shared future, stressing that its efforts are for development purposes. China has calculated that the Belt and Road Initiative will improve internal stability by modernizing the domestic economy and developing outlying provinces, such as Xinjiang. These efforts also enhance China’s external security through engagement efforts such as the Djibouti base and the rumored Gwadar port, which will greatly improve China’s capability to project power into the region. The 19th Party Congress report is, again, illustrative:

India must accept the emerging geopolitical reality that it will no longer be able to dominate its neighborhood, and give up on having a “sphere of influence” in Southern Asia independent of China.

India may seek to create “buffer space” to counter China’s influence, but this approach is unlikely to succeed, for both China and India’s smaller neighbors are willing, and in fact happy, to enhance the linkages. New Delhi reaffirmed its faith in the buffer notion with the resolution to last year’s Doklam standoff, involving a bilateral “disengagement” agreement. The signing of this agreement was a mutual face-saving bargain: China perceived itself to at least be “not losing” as Indian forces withdrew from Chinese territory, while India believed it had achieved “at least one victory” by restoring the status quo. However, China subscribes to disengagement mainly as a way to to cool down the dispute, since Indian elites regard the Northern hill states, Nepal, Bhutan, and even some parts of the Tibetan plateau as traditional “buffer” areas to avoid direct face-to-face interactions with China. In practice, though, China will continue to increase its presence in these areas. And the government of Nepal has welcomed enhanced land connectivity with China and increased transit trade between China and India. To some extent, India’s mindset limits its imagination and ability to accept China’s inevitable advances into these areas.

Even if the temporary creation of buffer space works on land, it will be more difficult in the maritime domain. India and China both have legitimate interests in protecting open sea lanes and ensuring trade across the Indian Ocean region. This requires the development of ports and other maritime infrastructure, but this on its own should not make India feel threatened.

If India instead gives up its fixation on an exclusive sphere of influence in Southern Asia, increased interaction and strategic competition between India and China in the Indian Ocean region is an opportunity for both sides to better understand each other’s threat perceptions and help to establish real communication.

Indeed, increased interactions in the region so far point to the possibility of mutual learning. Already, China has realized that India maintains the tools to compete with it for influence in its neighborhood and, possibly, to coerce or hedge against China’s presence. For example, India could compel Sri Lanka, Nepal, and Bangladesh to change the nature of their cooperation with China, can deter Pakistan, and may aspire to deny China’s further presence in the Indian Ocean through cooperation with the United States and alliances with Japan and Australia.

All of this is to say that India, despite its fears, has the potential to manage China in the emerging areas of overlap. But the dynamics of U.S.-India defense cooperation threaten to disrupt this balance, especially technology transfer such as the lately approved electromagnetic aircraft launch system. For Chinese observers, this has the potential to become dangerous if India regards America’s substantial defense cooperation as a commitment to come to India’s aid in a potential conflict with China. This could set up a moral hazard problem, potentially entrapping the United States in future India-China standoffs or conflicts.

Conclusion

India’s concerns about China’s encirclement are real, given China’s enabling of Pakistan as well as competition for influence among small states in the region. But encircling India is not the overarching objective of China’s growing presence in Southern Asia. Rather, this presence is part of China’s efforts to modernize its economy and military in line with its national interests. Still, China’s attempts to build a common destiny or shared future under the Belt and Road framework remain vague and confusing for outside actors, who misinterpret this as a threat to the regional and global order.

India, as one of the dominant powers of Southern Asia, has the resources to manage China’s increasing presence in the region, whether by deterrence, compellence, or balancing. The only exception is territory-related conflict on land, which will be harder to avoid and depend more on the two countries’ relative military capabilities as well as how much flexibility they exhibit in future agreements. These dynamics will not be clear until increased interactions lead to more mutual learning between India and China.

In the future, small-scale and limited conflicts are possible, but it is unlikely that these will evolve into destructive escalation, both because of the asymmetry in capabilities between India and China and because China has no intention to replace India as the dominant power in the region.

Given all this, the U.S. factor remains critical not only for the geopolitical balance of power, but also because its involvement raises escalation risks for future India-China conflicts. If India chose to balance China in the region through a “soft alliance” with the United States, China will likely respond by increasing its influence with other states in the region to hedge India’s leadership. But if India proceeds more cautiously regarding American cooperation, mutual learning will be easier. Ultimately, China and India, as neighbors both on land and at sea, must get to know each other better.

Correction: An earlier version of this article stated incorrectly that India and China share the world’s longest land border.

Yang Xiaoping is a visiting scholar in the South Asia Program at the Carnegie Endowment for International Peace, and senior research fellow at National Institute of International Strategy, Chinese Academy of Social Sciences. Her research focus is on the geopolitics of South Asia, Sino-India-U.S. strategic interactions, and China’s periphery diplomacy.